Chapter 13: Will buying a car after filing but before approval cause problems?

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What is the name of your state? PA

Hello,

I've been sued by a credit card company. I've submitted an answer, and also been thinking and preparing for a likely filing of Chapter 13. The date of my arbitration meeting with the creditor is in a couple of weeks (around August 10). I was advised to file before then.

At the same time, my car broke down and we've been saving up to get another used vehicle. I've not been able to make a purchase yet. We've saved about $5k for this car. I don't know if I'll have time to find and get a good deal on a car by the time I file for Chapter 13 bankruptcy protection.

Question:

• Will I encounter problems with the court's approval of my Chapter 13 filing if they see that $5k that was in a bank account when I filed, was later used to buy a car (which I need to get to the office)?

Thanks,
JPG.

 

[LdiJ]

What is the name of your state? PA

Hello,

I've been sued by a credit card company. I've submitted an answer, and also been thinking and preparing for a likely filing of Chapter 13. The date of my arbitration meeting with the creditor is in a couple of weeks (around August 10). I was advised to file before then.

At the same time, my car broke down and we've been saving up to get another used vehicle. I've not been able to make a purchase yet. We've saved about $5k for this car. I don't know if I'll have time to find and get a good deal on a car by the time I file for Chapter 13 bankruptcy protection.

Question:

• Will I encounter problems with the court's approval of my Chapter 13 filing if they see that $5k that was in a bank account when I filed, was later used to buy a car (which I need to get to the office)?

Thanks,
JPG.

If that is going to be the only car that you will own, no, it won't be a problem. You are allowed to have transportation to work.

Now if you had 50k in the bank and used it to buy a big shiny Cadillac, THAT would be an entirely different story.

 

[jpg90]

Thank you for your quick reply. It is not the only car we have. We have another car, but my wife uses it to go to work 2 or 3 days a week, as well as for other things.
Would that make a difference? I cannot remember off the top of my head if that other car is in my name or her name.

I'm also not yet sure if both my wife and I will file for Chapter 13, or if it will be just me.

What do you think?